The Company has had a nonqualified incentive stock option plan, the BancFirst Corporation Stock Option Plan (the “Employee Plan”), since May 1986. At December 31, 2022, there were 35,000 shares available for future grants. The Employee Plan will terminate on December 31, 2024, if not extended. The options vest and are exercisable beginning four years from the date of grant at the rate of 25% per year for four years. Options expire no later than the end of fifteen years from the date of grant. The option price must be no less than 100% of the fair value of the stock relating to such option at the date of grant.

The Company has had the BancFirst Corporation Non-Employee Directors’ Stock Option Plan (the “Non-Employee Directors’ Plan”) since June 1999. Each non-employee director is granted an option for 10,000 shares. At December 31, 2022, there were 45,000 shares available for future grants. The Non-Employee Directors’ Plan will terminate on December 31, 2024, if not extended. The options vest and are exercisable beginning one year from the date of grant at the rate of 25% per year for four years, and expire no later than the end of fifteen years from the date of grant. The option price must be no less than 100% of the fair value of the stock relating to such option at the date of grant.

The Company currently uses newly issued shares for stock option exercises, but reserves the right to use shares purchased under the Company’s Stock Repurchase Program (the “SRP”) in the future.

Although not required or expected, the Company may settle some options in cash on a limited basis at the discretion of the Company. During the year ended December 31, 2022, the Company did no

t settle any options for cash. During the year ended December 31, 2021, the Company had cash settlements for 121,330 shares for a total net cash settlement of options of $5.5 million that did not increase the outstanding shares of the Company.

The following table is a summary of the activity under both the Employee Plan and the Non-Employee Directors’ Plan:


						Wgtd. Avg.
				Wgtd. Avg.		Remaining	Aggregate
				Exercise		Contractual	Intrinsic
	Options			Price		Term	Value
	(Dollars in thousands, except option data)
Year Ended December 31, 2022
Outstanding at December 31, 2021		1,303,250		$	40.90
Options granted		278,500			87.13
Options exercised		(241,460	)		28.06
Options canceled, forfeited, or expired		(30,000	)		66.31
Outstanding at December 31, 2022		1,310,290			52.51	8.73Yrs	$	46,741
Exercisable at December 31, 2022		489,540			30.82	6.80Yrs	$	28,082

Year Ended December 31, 2021
Outstanding at December 31, 2020		1,343,080		$	35.28
Options granted		179,500			62.13
Options exercised		(214,330	)		23.40
Options canceled, forfeited, or expired		(5,000	)		44.23
Outstanding at December 31, 2021		1,303,250			40.90	8.40Yrs	$	38,656
Exercisable at December 31, 2021		614,875			28.03	7.15Yrs	$	26,153

The following table has additional information regarding options exercised under both the Employee Plan and the Non-Employee Directors’ Plan:


	Year Ended December 31,
	2022		2021		2020
	(Dollars in thousands)
Total intrinsic value of options exercised	$	14,837	$	9,264	$	2,315
Cash received from options exercised		6,776		5,015		1,574
Tax benefit realized from options exercised		3,567		2,360		590

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model and is based on certain assumptions including risk-free rate of return, dividend yield, stock price volatility and the expected term. The fair value of each option is expensed over its vesting period.

The following table is a summary of the Company’s recorded stock-based compensation expense:


	Year Ended December 31,
	2022		2021		2020
	(Dollars in thousands)
Stock-based compensation expense	$	1,941	$	2,133	$	1,516
Tax benefit		467		513		386
Stock-based compensation expense, net of tax	$	1,474	$	1,620	$	1,130

The following table shows the assumptions used for computing stock-based compensation expense under the fair value method on options granted during the periods presented:


	Year Ended December 31,
	2022		2021		2020
Weighted average grant-date fair value per share of options granted	$	31.90	$	21.16	$	10.85
Risk-free interest rate	1.75 to 4.17%		1.30 to 1.74%		0.64 to 1.13%
Dividend yield	2.00%		2.00%		2.00%
Stock price volatility	34.61 to 35.60%		35.55 to 36.39%		22.84 to 36.1%
Expected term	10 Yrs		10 Yrs		10 Yrs

The risk-free interest rate is determined by reference to the spot zero-coupon rate for the U.S. Treasury security with a maturity similar to the expected term of the options. The dividend yield is the expected yield for the expected term. The stock price volatility is estimated from the recent historical volatility of the Company’s stock. The expected term is estimated from the historical option exercise experience. The Company accounts for forfeitures as they occur.

The Company has had the BancFirst Corporation Directors’ Deferred Stock Compensation Plan (the “Deferred Stock Compensation Plan”) since May 1999. As of December 31, 2022, there are 26,288 shares available for future issuance under the Deferred Stock Compensation Plan. The Deferred Stock Compensation Plan will terminate on December 31, 2024, if not extended. Under the plan, directors and members of the community advisory boards of the Company and its subsidiaries may defer up to 100% of their board fees. They are credited for each deferral with a number of stock units based on the current market price of the Company’s stock, which accumulate in an account until the director or community board member terminates serving as a board member. Shares of common stock of the Company are then distributed to the terminating director or community board member based upon the number of stock units accumulated in his or her account. There were 30,982 and 5,400 shares of common stock distributed from the Deferred Stock Compensation Plan during the years ended December 31, 2022 and 2021, respectively.